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S.C. District Court Finds Posting Rule Exceeds Authority

With the notice posting requirement set to take effect on April 30, 2012, court decisions continue to emerge regarding the legality of the posting requirement.  On April 13, 2012, the United States District Court for the District of South Carolina held the National Labor Relations Board (NLRB) exceeded its authority in promulgating the notice posting requirement.  The district court granted summary judgment in favor of the U.S. Chamber of Commerce and South Carolina Chamber of Commerce by finding the NLRB violated the Administrative Procedure Act by putting the posting requirement into effect.  This posting requirement has and will continue to face legal challenges around the nation.

The South Carolina court found that the NLRB's notice posting requirement is entirely Board created, unlike other employer obligations under other statutes including Title VII of the Civil Rights Act, the Occupational Health and Safety Act (OSHA), or the Family and Medical Leave Act (FMLA), where congressional intent demonstrated an intent to notify employees of their rights. The court analyzed both Section 6 of the National Labor Relations Act (NLRA) and the NLRA structure, finding the notice posting requirement to be merely useful and only aid or further the goals and purpose of the NLRA, not necessary to reach the goals of the NLRA. The South Carolina district court found that if Congress intended for employers to notify employees of their rights under the NLRA, it could have included this requirement in either the NLRA or subsequent amendments.  Currently, such an amendment is unlikely considering the political makeup of Congress.

Section 6 of the NLRA confers the rulemaking authority to the NLRB. Section 6 specifically provides, "The Board shall have authority from time to time to make, amend, and rescind, in the manner prescribed by the Administrative Procedure Act, such rules and regulations as may be necessary to carry of the provisions of this Act."

The South Carolina decision is in conflict with the federal district court for the District of Columbia that ruled in March the penalty provisions was invalid, but the posting requirement was within the NLRB's authority. That March decision is currently under appeal to the U.S. Court of Appeals for the District of Columbia Circuit. It is unknown if the NLRB will appeal the South Carolina district court's decision, but should be expected. Employers must be kept aware of likely further developments regarding the posting requirement and its impact on their businesses.  The conflicting decisions will leave some employers unsure as to whether they are required to comply with the posting requirements. Employers should consult with their labor counsel to determine whether they are required to post the notice to employees and how to meet this requirement.

By: Justin A. Morocco

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